The foreign exchange used for the importation of food products into Nigeria from January to August 2021 rose to $1.41 billion despite the directive that the Central Bank of Nigeria (CBN) should stop issuing forex for food and fertiliser imports.
Forex supply for food imports in the eight-month period rose by 35.28 per cent from $1.04 billion in the same period 2020.
President Buhari had in September 2020 given a directive to the CBN at a meeting of the National Food Security Council at the Presidential Villa, Abuja, saying that firms that were bent on importing food should source their forex elsewhere.
“Nobody importing food should be given money,” he was quoted as saying in a statement from the Senior Special Assistant to the President on Media and Publicity, Garba Shehu.
A breakdown
The forex used for food products imports, however, rose from $163.6 million in January 2021 to $197.73 million in February but fell to $171.05 million in March and $156.3 million in April, according to the CBN data on sectoral utilisation for transactions valid for forex.
The amount of forex used for the importation of food products into the country surged to $213.58 million in June from $135.76 million in May.
In July, it fell to $184.69 million but rose again to $188.88m in August, the CBN data show.
Amid the economic fallout of the COVID-19 pandemic, forex supply for food imports fell by 9.22 per cent 2020 to $1.87 billion from $2.06 billion in 2019, accounting for about 6.57 per cent of the $28.46 billion utilised for imports.
The apex bank, in June 2015, excluded importers of 41 goods and services, including some food products, from accessing forex at the country’s forex markets in a bid to conserve the external reserves as well as encourage local production of those items.
The Monetary Policy Committee said last month that between September and October 2021, under the Anchor Borrowers’ Programme, the CBN disbursed ₦43.19 billion to support the cultivation of over 250,000 hectares of maize, sorghum, soya beans and rice during the 2021 dry season.
It said ₦5.88 billion was disbursed to finance six large-scale agricultural projects under the Commercial Agriculture Credit Scheme.
The MPC said, “Cumulatively, the bank has disbursed the total sum of ₦864 billion to 4.1 million farmers, cultivating 5.02 million hectares. The bank also disbursed the sum of ₦41.2 billion for the commencement of the brown revolution, a large-scale wheat program to wean us off imports by 35 per cent in the first year.
“The continued security challenge across the country remained a major source of concern for Members, noting its impact on business confidence, foreign investment inflows and overall economic activities. The persistence of insecurity in major food-producing areas remained a key downside risk to the recovery.”
The committee said with improved security, especially in the food-producing areas, food inflation would drop significantly following successful harvests and distribution.
